Abstract
International law exists for several purposes including the provision of principles and modalities governing peaceful settlement of disputes. Whilst utilization of outer space continues to have a transformational impact on humankind, the emergence of a global space industry can be attributed to increased involvement by private enterprise in outer space ventures, traditionally conducted by States through Public-Private Partnerships (PPP’s), amongst other business ventures. PPP’s raise a variety of interesting and important questions of a legal nature including the settlement of disputes if and when they do arise. Noting that arbitration is increasingly used for settling disputes, under privately financed infrastructure projects, alongside the fact that international arbitration has evolved as the preferred method for resolving disputes arising from cross-border investments, particularly those involving States, this chapter addresses prospects for arbitration of disputes relating to outer space activities, arising from PPP’s. This chapter examines particular characteristics of existing arrangements for dispute settlement in PPP’s, identifying gaps if any, and justifies a proposal for pragmatic solutions, relying on the Optional Rules for Arbitration of Disputes Relating to Outer Space, adopted in 2011 by the Permanent Court of Arbitration.
This chapter re-visits arguments first advanced in 2010 as a discussion paper, titled: Alternative Resolution of International Investment Disputes in Public-Private Space Projects, invited by and submitted to the Chair (H.E. Judge Fausto Pocar) of the PCA Advisory Group of Experts, mandated to develop Optional Rules for Arbitration of Disputes Relating to Outer Space Activities (PCA Advisory Group) and is written and published in the sole opinion of the author.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
On December 6, 2011, the Administrative Council of the PCA adopted Optional Rules for the Arbitration of Disputes Relating to Outer Space Activities. (Outer Space Optional Rules).
- 2.
UNCITRAL was established by UNGA Resolution 2205 (XXI) of 17 December 1966 to promote the progressive harmonization and unification of international trade law.
- 3.
Adopted on 28 April 1976, Yearbook of the United Nations Commission on International Trade Law, vol. VII, 1976, part one, chap. II, sect. A (United Nations publication, Sales No. E.77.V.1). The 1976 text was revised in August 2010, UNGA Resolution 65/22 of 10 January 2011, text reprinted in http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/2010Arbitration_rules.html
- 4.
UN Publication, A/CN.9/SER.B/4, UNCITRAL Legislative Guide on Privately Financed Infrastructure Projects (2001) ISBN 92-1-133632-5 (UNCITRAL Guide).
- 5.
See: Brisibe T., Law and Regulation of Activities Related to Outer Space in Nigeria, Zeitschrift für Luft- und Weltraumrecht, Vol. 4 (2006) at pages 562 and 565.
- 6.
See: Regulation (EU) No. 1285/2013 of the European Parliament and of the Council of 11 December 2013 on the implementation and exploitation of European satellite navigation systems and repealing Council Regulation (EC) No 876/2002 and Regulation (EC) No 683/2008 of the European Parliament and of the Council.
- 7.
“Space Act Agreements” concluded pursuant to the U.S. National Aeronautics and Space Act of 1958 (Space Act), as amended (42 U.S.C. § 2451 et seq.).
- 8.
UNIDROIT , an independent intergovernmental organization established to study needs and methods for modernizing, harmonizing and co-coordinating private and in particular commercial law as between States and groups of States, is applying the 2001 Convention on International Interests in Mobile Equipment (Cape Town Convention ) to space assets by the 2012 Protocol on Matters specific to Space Assets (Space Protocol). For an overview, see Stanford M. J., The Way to the Successful Completion of the Negotiations, in Proceedings of the International Institute of Space Law (2014) Volume 56, ISBN 978‐94‐6236‐440‐0, at pages 691–714. This author participated at related multilateral fora, including the: UNCOPUOS Space ad hoc consultative mechanism (Paris, September 2001); 1st Session of the Committee of Governmental Experts for the preparation of a draft Protocol to the Convention on International Interests in Mobile Equipment on Matters specific to Space Assets (Rome, December 2003), and the 2nd Government/Industry Forum on the preliminary draft Protocol on Matters Specific to Space Assets (London, April 2006).
- 9.
See: UNCITRAL Guide, Supra, note 4 at page 1.
- 10.
At present, Arianespace’s 24 shareholders include companies from the Ariane industrial team and national space agencies. See: http://www.arianespace.com/about-us-corporate-information/shareholders.asp last accessed on 9 May 2015 and based on information last updated on January 5, 2011.
- 11.
The Landsat program was subject to attempts at its privatization pursuant to the repealed Land Remote Sensing Commercialization Act, 15 U.S.C. §§4201–4292 (1984) by a PPP involving the U.S. National Oceanic and Atmospheric Administration and the Earth Observation Satellite Company (EOSAT) later re-named Space Imaging. See: Gabrynowicz, J. I., Expanding Global Remote Sensing Services, in Proceedings of the Workshop on Space Law in the Twenty-First Century, UNISPACE III Technical Forum, July 1999, UN Publications, (2000) ISBN 92-1-100833-6 at page 99.
- 12.
For a description of space related PPP’s in China, India and the Philippines, See: UNESCAP, Public-Private Partnership and Community Participation an Applications of Space Technology For Socio-Economic Development Compilation of Policies And Practices In Selected ESCAP Member Countries, (2007). For a 2013 summary report of Public-private collaboration on space activities See: Space Security Index (2013) ISBN 978-1-927802-05-2 at pages 64–66.
- 13.
See Deloitte Research, Closing the Infrastructure Gap: The Role of Public-Private Partnerships (2006) at page 5.
- 14.
UNCITRAL Guide, Supra, note 4 at pages 13–14.
- 15.
The choice of a PPP model may include: Design-Build; Design-Build-Maintain; Design-Build-Operate; Design-Build-Operate-Maintain; Build-Own-Operate-Transfer; Build-Own-Operate; Design-Build-Finance-Operate/Maintain. PPPs can also be used for existing services and facilities in addition to new ones. Some of these models include Service Contract; Management Contract; Lease; Concession; and Divestiture. For detailed definitions, see: Deloitte Research, Supra note 13 at page 5.
- 16.
Non-public financing of infrastructure could involve debt finance (loans obtained on commercial markets) or equity investment, from which various financing sources include: equity capital; commercial loans; “subordinated” debt; institutional investors; capital market funding; financing by Islamic financial institutions (due to restrictions on charging interest); financing by international financial institutions; and combined public and private finance. UNCITRAL Guide, Supra, note 4 at pages 15–18.
- 17.
For an overview of Security Interests see: Omar P., International Insolvency, Security Interests and Creditor Protection, in Davies I., (ed.) Security Interests in Mobile Equipment , Ashgate, (2002) at pages 293–334.
- 18.
Article I (2) (b of the Space Protocol, http://www.unidroit.org/instruments/security-interests/space-protocol last accessed on 9th May 2015.
- 19.
Id. Article I (2) (k), defines a “space asset” as “any man-made uniquely identifiable asset in space or designed to be launched into space, and comprising (i) a spacecraft, such as a satellite, space station, space module, space capsule, space vehicle or reusable launch vehicle, whether or not including a space asset falling within (ii) or (iii) below; (ii) a payload (whether telecommunications, navigation, observation, scientific or otherwise) in respect of which a separate registration may be effected in accordance with the regulations; or (iii) a part of a spacecraft or payload such as a transponder, in respect of which a separate registration may be effected in accordance with the regulations, together with all installed, incorporated or attached accessories, parts and equipment and all data, manuals and records relating thereto.”
- 20.
Id. Article I (2) (h).
- 21.
Id. Article I (2) (i).
- 22.
Stanford M. J., The preliminary draft Protocol to the Cape Town Convention on Matters specific to Space Assets: A unique opportunity to expand the benefits of space-based services and to broaden the market for commercial space activities in general, in Proceedings of the UN/Iran Workshop on Space Law, Role of International Space Law in the Development and Strengthening of International and Regional Cooperation of States in the Peaceful Exploration and Uses of Outer Space, Tehran, 8–11 November 2009. See further: Stanford M. J., and de Fontmichel A., Overview of the current situation regarding the preliminary draft Space Property Protocol and its examination by COPUOS, Unif. L. Rev, 2001-1, at pages 60–77; UN Doc. A/AC.105/C.2/L.225 Draft Convention of the International Institute for the Unification of Private Law on international interests in mobile equipment and the preliminary draft protocol thereto on matters specific to space property – Report of the Secretariat and the secretariat of the International Institute for the Unification of Private Law; and UNIDROIT 2010 C.G.E./Space Pr./4/Report.
- 23.
UNCITRAL Guide, Supra, note 4 at page 175.
- 24.
Id. at page 173.
- 25.
Ibid. Public projects, including those of a space-related nature, could be governed by either administrative law or contract law as supplemented by special provisions developed for government contracts for the provision of public services .
- 26.
Id. at page 174. Such contracts would usually include at least: (i) contracts between parties holding equity in the project company; (ii) loan and related agreements; (iii) contracts between the project company and contractors, which themselves may be consortia of contractors, equipment suppliers and providers of services; (iv) contracts between the project company and the parties who operate and maintain the project facility; and (v) contracts between the concessionaire and private companies for the supply of goods and services needed for the operation and maintenance of the facility.
- 27.
Ibid. Users or customers of the facility, which in the context of space-related PPP’s could include customers of downstream space services such as airlines, airports, marine vessels etc., or even individual users of satellite communications terminals or GPS receivers. Parties to these disputes may not necessarily be bound by any prior legal relationship of a contractual or similar nature.
- 28.
UN Treaty Series, Vol. 575, No. 8359 (1981). Establishing the International Center for the Settlement of Investment Disputes (ICSID).
- 29.
Laws of the Federation of Nigeria, Chapter N117, (Decree No 16 of 1995).
- 30.
UNCITRAL Guide, Supra, note 4 at page 175.
- 31.
For instance, the procurement process for manufacture, launch and in-orbit delivery of a commercial satellite could take anywhere between 2 and 5 years at the minimum.
- 32.
UNCITRAL Guide, Supra, note 4 at page 175.
- 33.
Acronym for European Space Agency.
- 34.
Farand A., The European Space Agency’s Experience with Mechanisms for the Settlement of Disputes, in Permanent Court of Arbitration/Peace Palace Papers, Arbitration in Air, Space and Telecommunications Law, Kluwer Law International (2002) ISBN 90-441-1773-3, at page 145. For similar conclusions see: Bohlmann U. K., Disputing with ESA, in Proceedings of the International Institute o f Space Law (2014) Volume 56, ISBN 978‐94‐6236‐440‐0, at pages 213–226.
- 35.
UNCITRAL Guide, Supra, note 4 at pages 176–187.
- 36.
This author advised negotiations to secure Export Buyers Credit from China Export Import Bank for part financing procurement of Nigcomsat-I, and to obtain insurance covering launch and in-orbit delivery. On behalf of the Nigerian space agency (NASRDA) the author maintained legal oversight of Nigcomsat Limited being the private company incorporated to manage satellite network operations and deliver services to public and private sector users from the Nigcomsat-I satellite. NASRDA is a para-statal of the Nigerian Federal Ministry of Science and Technology.
- 37.
Supra note 6.
- 38.
Farand, Supra, note 34 at page 156 and Cf: Bohlmann U. K., Supra, note 34.
- 39.
Specifically with respect to the ESA practice on the conclusion of written contracts, see: Annex 1 (Privileges and Immunities), Article XXV of the Convention for the Establishment of a European Space Agency, 14 I.L.M. p. 864 (1975). The said Article XXV reads: “1. When concluding written contracts, other than those concluded in accordance with the Staff Regulations, the Agency shall provide for arbitration. The arbitration clause or the special arbitration agreement concluded to this end shall specify the law applicable and the country where the arbitrators sit. The arbitration procedure shall be that of that country. 2. The enforcement of the arbitration award shall be governed by the rules in force in the State on whose territory the award is to be executed.” For related implementing regulations, see: Regulations of The European Space Agency – General Clauses and Conditions for ESA Contracts, ESA/REG/002, rev. 1 Paris, 7 February 2013.
- 40.
Cf: Dispute resolution provisions of various bilateral Memoranda of Understanding governing co-operation on the civil international space station, available on-line at: http://www.esa.int/SPECIALS/ECSL/SEMYF7D3M5E_2.html. Last accessed on 10 May 2015.
- 41.
A 2014 report listing active NASA Space Act Agreements shows the agency has concluded nearly 1800 such instruments with domestic and international entities. See: National Aeronautics and Space Administration, Office of Inspector General, Report No. IG-14-020, NASA’s Use of Space Act Agreements, June 5, 2014.
- 42.
See: NASA Policy Directive 1050.1I, NAII 1050-1A NASA Advisory Implementing Instruction, Space Act Agreements Guide.
- 43.
The Commercial Orbital Transportation Services Demonstration program (COTS) is intended to motivate private development of commercial spacecraft capable of servicing the International Space Station with the retirement of the Space Shuttle. Rocketplane Kistler (RpK) was dropped from the COTS program in 2007 for failing to meet financial milestones.
- 44.
Cf: Space Act Agreements between NASA and various private sector entities in respect of Commercial Crew Development with: Blue Origin; Paragon Space Development Corporation; Sierra Nevada Corporation Space Systems; The Boeing Company; United Launch Alliance, and COTS with: Space Exploration Technologies Corp. (SpaceX) and Orbital Corporation.
- 45.
NASA Advisory Implementing Instruction, NAII 1050-1A, dated August 15, 2008.
- 46.
Id. § 4.5.17.
- 47.
For a commentary on Article 42, see: UNIDROIT 2003 C.G.E. Space Pr./1/W.P.4, Extract from the Official Commentary on the Convention on International Interests in Mobile Equipment and Protocol thereto on Matters specific To Aircraft Equipment by Professor Sir Roy Goode, Rome, June 2003 at pages 118–120.
- 48.
Article 43 (Jurisdiction under Article 13) pertains to interim relief pending final determination of a creditor ’s claim.
- 49.
Laws of the jurisdiction in which a legal action is brought.
- 50.
UNCITRAL Guide, Supra, note 4 at page 183.
- 51.
Onwuamaegbu U., International Dispute Settlement Mechanisms – Choosing Between Institutionally Supported and Ad Hoc; and Between Institutions, in Yanaca-Small K., (ed) Arbitration Under International Investment Agreements – A Guide to the Key Issues, (2010) Oxford University Press at page 64.
- 52.
Ibid. Citing R. Doak Bishop et al, Foreign Investment Disputes: Cases, Materials and Commentary, 12, Kluwer Law International, (2005).
- 53.
[2009] EWHC 2853 (Comm), [2010] 1 Lloyd’s Rep 324.
- 54.
Republic of Ecuador v Occidental Exploration and Production Co [2006] QB 423. In this case “the Court of Appeal considered jurisdictional issues that arose under an agreement to arbitrate under UNCITRAL Rules that both parties agreed was validly made by them.” See the decision of the U.K. High Court in Republic of Serbia v Imagesat International NV, Supra note 53 at paragraphs 115, 116 and 117.
- 55.
It is reported that “the above decision led to a 28 million euro ($38.4 million) arbitration settlement from the government of Serbia and an agreement by Israel Aerospace Industries Ltd of Israel, to buy $81 million worth of ImageSat bonds held by Pegasus Capital Advisors LP, a New York-based private equity investment firm.” See: Barbara Opall-Rome, Israel’s ImageSat Sheds Some Legal Baggage, Space News, Friday, 28 January, 2011.
- 56.
The 9 (nine) characteristics were advanced by this author in January 2011, concerning the first draft of Outer Space Optional Rules, in response to an invitation for comments, from the Chair (H.E. Judge Fausto Pocar) of the PCA Advisory Group of Experts. Also published in: Brisibe T., The 5th Nandasiri Jasentuliyana Keynote Lecture on – A Normative System for Outer Space Activities in the Next Half Century, in: Proc. IISL Coll. (2014) Volume 56, ISBN 978‐94‐6236‐440‐0 at pages 25–26; Brisibe T., The Role of Arbitration in Settlement of Disputes Relating to Outer Space Activities, Financier Worldwide, December 2012, pp. 48–50.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2016 Springer International Publishing Switzerland
About this chapter
Cite this chapter
Brisibe, T. (2016). Prospects for the Arbitration of Disputes in Public – Private Space Projects. In: Sterns, P., Tennen, L. (eds) Private Law, Public Law, Metalaw and Public Policy in Space. Space Regulations Library, vol 8. Springer, Cham. https://doi.org/10.1007/978-3-319-27087-6_3
Download citation
DOI: https://doi.org/10.1007/978-3-319-27087-6_3
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-27085-2
Online ISBN: 978-3-319-27087-6
eBook Packages: Law and CriminologyLaw and Criminology (R0)